Firm gets in on the Ground Floor of the IT Market

Cox Systems Technology, Oklahoma City, Okla., has been in voice/data/video since Walter and Naomi Cox founded the company in 1959. They first specialized in repairing radios.

The business grew during the next decade to include low-voltage contracting by installing intercom systems for schools and hospitals and small sound systems for a variety of clients. By the 1970s, the low-voltage market began to expand, and Cox Systems' information technology (IT) component grew right along with it.

Today, what was once a radio repair shop has annual sales of about $3.8 million, and employs seven people in the office and 13 low-voltage technicians in the field.

The company primarily serves the health care, educational, and the institutional and correctional markets and specializes in the installation of such electronic systems as nurse call, fire alarm, intercom, security, sound, CCTV, telephone and voice mail, and data cabling. In addition, systems integration, especially in the correctional facilities market, has been a particularly high-growth market for the company during the past five years.

"The information technology market has seen dramatic growth over the last 10 years, and by the end of the next decade, Cox Systems will specialize solely in IT projects," predicts Thomas G. Smith, president.

Providing field technicians with laptops gave the operations manager a medium to provide info and improve documentation. "At the time, the company was still primarily installing intercom and sound systems in the electrical construction market only," he says. Smith immediately began focusing on improving the quality of workmanship at Cox, building a reliable reputation in the marketplace, and expanding into new markets such as telephone interconnects and fire alarm system work.

"One step in establishing a quality reputation was to select well-known, high-quality vendors to represent on a proprietary basis," he states. The company entered into agreements with Toshiba, New York, for its telephone interconnect projects; Altec, Birmingham, Ala., for its engineered sound products; and Dukane, St. Charles, Ill., for its nurse-call and intercom systems projects.

In 1987, Smith purchased Cox Systems Technology from a national conglomerate. The company immediately began focusing on expanding its current market share and building on the reputation for quality work it had established during Smith's tenure as general manager. "We began to sell more services directly to facilities, negotiate more projects -- as opposed to bidding them traditionally, and work on more design build projects," he says.

The future of education

The town of Norman, Okla., needed to build a brand-new high school. Prior to being awarded the contract through the traditional bid process, Cox Systems worked closely with the school district and the project's architect and engineers to help design the low-voltage systems for Norman North High School. On being awarded the contract, Cox Systems became responsible for installing and integrating the intercom and telephone systems, installing the sound system for the multipurpose auditorium that houses public speaking and sporting events, and doing the data cabling for the 600 classroom PC workstations, as well as networking those computers to the school's central media facility via fiberoptic cable.

There were 250 intercom points and 120 telephone stations throughout the school to be installed and integrated. "This integration gives teachers and administrators the ability to communicate with each other directly from the classroom," Smith explains. For example, a call made from the intercom in a classroom can be picked up in the office on the telephone, and vice versa.

For the sound system in the 1,500-seat, multi-purpose auditorium, Cox systems had to install 18 speaker arrays, which were distributed across the top of the 30-foot-high ceiling. The company also installed both the wireless and hard-wired microphone channels, which included multiple audio programming capabilities.

"The fact that the company is known in the area as multi-faceted, with the ability to ensure the proper installation of integrated systems on time and on budget, were major contributing factors to our being awarded the job," Smith says. Another major reason the company was selected to do the work was its emphasis on providing end-use training.

"The data component was quite large and complex, and the school district relied on our reputation of quality workmanship and customer service to do the job." The $400,000.00 project was awarded in December 1997 with a completion date of August 1998 and the average number of technicians on site was six.

Special challenges

A major obstacle during Cox's work on the school was project management. "The number of systems involved and the fast-track nature of the project put a strain on how we managed it," Smith says.

In order to deal with these factors, the company set up a process of multitiered supervision. Each subsystem was assigned a foreman, who reported daily to the operations manager on the progress of that particular installation.

The operations manager then coordinated all of the labor and material requirements before filtering that information back to the field, insuring that everyone had shared, complete, current information. To help the flow of all that vital data, the company provided laptops to the technicians in the field. "This was the first time we used laptops on a project," Smith says.

The computers not only helped speed up the transfer of information between the field and the office, but they improved the documentation process as well. "The benefits we received by using this technology on this job spurred the decision to always use laptops in the field for communication purposes," Smith says. The company also now uses its computers in the field for system initialization and installation.

Another major challenge for Cox Systems was to improve customer training. "It doesn't do the customer any good to buy an expensive, complicated intercom and telephone system and then not be able to use it," Smith observes.

The company devoted more than 160 man-hours to train 120 staff members on the integrated communication system.

Cox Systems has learned other valuable lessons while performing some of its larger designbuild projects at various correctional facilities. For instance, Smith says, to ensure proper completion of a project, the company starts ordering all the necessary material upon being awarded the job and stores it on site in security containers that are categorized by system.

"Design-build projects today have a very short demand curve," he explains. Not only are current customers demanding faster project completions but also suppliers are running on much shorter order cycles than in the past. "The contractor that plans ahead by ordering material immediately can help insure that it the project will be completed on time."

The customer is always right

Cox Systems believes in providing added value to its low-voltage services, such as a two-year warranty on installations. "It is our responsibility to provide total systems solutions and to meet all of the customer's requirements and objectives," Smith observes. The company fulfills that responsibility by presuming that the customer is always right and entitled to satisfaction. "Our goal is to make it as easy as possible for our customers to do business with us."

The company also promotes an open relationship between management and labor. The result is very low turnover, with some employees staying with the company for 10 to 15 years. To provide service to its customers and to establish a reputation as a company that fulfills its customers' needs quickly and with high-quality workmanship, Cox Systems provides its technicians with all the tools they require to do the job. "We not only provide educational tools, but also the hardware needed to perform the work, such as laptops in the field," Smith says.

To further maintain consistent lines of communication, the company holds regular weekly meetings to discuss project problems, solutions, objectives, and to answer technicians' questions. "These meetings are a forum for the technical staff to express their concerns and requirements and a means for management to relay the company's overall objectives and how it plans to meet them," he explains.

In addition, Smith has always thought it particularly important to recognize outstanding performance, as well as to point out areas in which employees can improve. But, he adds, he wants employees to learn from their mistakes, not be punished for them. "Every technician has the authority and responsibility to stop work on a project because of a problem. They know they don't have to worry about getting in some kind of trouble because they may cost the company money by stopping work." In this way, Cox Systems encourages its employees to operate in the best interest of the customer and to provide the highest possible level of service.

Plans for the future

As part of its plan to enter into markets outside of its geographical area, the company has signed a national agreement to represent Dukane's line of industrial communication products. Smith's emphasis and concern, however, is not focused on getting bigger but on getting better. "If the company satisfies its customer base correctly and provides the necessary services, growth is a natural outcome," he says.

Cox Systems also plans to pursue more systems integration work. "We are pursuing systems integration work with the idea that in the next five years information technology will be the primary growth market," Smith observes. He thinks the challenge for a systems contractor is to decide exactly which market segments it should not pursue: "No company can be all things to the marketplace, but rather has to insure that it can be the best at what it does."

Smith believes that Cox's biggest challenge in the future will be to stay informed about the ever-changing technologies in the IT market. To position itself to meet that challenge, the company provides its office employees with individual PCs, ISDN lines, e-mail, and Internet access. "If you're not connected, it will significantly affect your business within the next two years because the engineers, architects, and owners in the IT market have that technology and expect their contractors to be on the cutting edge as well," he explains.

In addition, the suppliers that IT contractors work with are concentrating on constructing their own Web sites and using electronic commerce to decrease their own costs and increase the flow of data. "To succeed in the years to come, we must not only provide the latest technologies to our customers but must use those same technologies to improve business operations," Smith said.

Cox System's Web site's goal is to keep customers informed of the systems and services the company offers, allow architects and engineers to download project specifications from a secured site, and to allow field staff to access secured customer data to insure the customer's needs are being met.

Smith observes that any contractor who wants to get into the IT market can overcome the problem of technical know-how and learn how to install these low-voltage systems. But to be truly successful, the company must change its organization and focus on training the customer.

To provide this added value, a company needs to invest in a full-time customer service representative whose responsibility it is to oversee end-user training and provide total IT solutions to customer's problems. "If the end-user doesn't know how to use the technology, you have failed in providing full service and will ultimately be less successful in the market," he advises.

Because the company has invested heavily in building a reputation of providing consistent, high-quality work on time and on budget, everyone in the firm is dedicated to providing the company's customers with total IT solutions. "Our quality of workmanship and consistency of service sets us apart from other information technology contractors in the area," Smith concludes.

Bremer, a freelance writer based in Solomons, Md., contributes frequently to Electrical Contractor. She can by reached at (410) 394-6966 or by e-mail at dbremmer@erols.com.